Buying OEM versions of Windows Vista: the facts

I've received a number of e-mails from readers looking for more information on …

Today Vista launches. I've received a number of e-mails from readers looking for more information on the black arts of the OEM edition, so here it is: my brief introduction to everything you need to know before going OEM.

What is OEM?

OEM stands for Original Equipment Manufacturer, and most often refers to the likes of Dell or Gateway. At least originally, "OEM versions" of products were usually the same products that you'd find at retail, but with no-frills packaging, reduced support, and sometimes lesser warranties.

When it comes to Windows, "OEM editions" most often refer to the cheaper versions of Windows made available to "system builders" and other classes of Microsoft partners. You can buy OEM versions of Windows online almost any place that sells software, such as NewEgg. Companies keep compliant with Microsoft's rules by bundling OEM versions with a token piece of hardware, like a cable. Here's a glimpse of current OEM pricing:

Vista Home Basic $99 (full version retail: $199)

Vista Home Premium: $119 (full version retail: $239)

Vista Business: $149 (full version retail: $299)

Vista Ultimate $199 (full version retail: $399)

As a general rule, OEM software is usually much cheaper than full retail copies, but only slightly cheaper than retail upgrades. Vista upgrade pricing, plus a word or three on the limitations of the upgrade versions, can be found here.

Can I buy OEM?

Yes, you can. Microsoft licenses OEM software to "system builders," which the license defines as "an original equipment manufacturer, or an assembler, reassembler, or installer of software on computer systems" (emphasis added). You can install software on computers, right?

When asked, Microsoft says that OEM software is not intended to be installed by end users. Off the record, Microsoft spokespeople have told me that the big concern in Redmond is for Joe Newbie. They don't want inexperienced users buying OEM software, but the fact of the matter is that anyone can buy OEM versions of Windows.

Truth be told, Microsoft is not opposed to the practice. Rather, the company says that people who purchase OEM software will simply be expected to abide by the terms of the licensing agreements.

What's missing from the OEM version?

When you buy OEM, you need to understand what you're getting.

OEM editions of Windows don't come in pretty boxes, nor do they include manuals. Of course, a real "manual" has never shipped with Windows, and chances are, if you're interested in OEM software, you don't need what passes for a manual these days, anyway. And the pretty box... well, that's not really worth much anyway, is it? Rest assured, though: the software on the disc is the same as that found in any retail edition.

There are some gotchas, though. OEM software cannot be returned once opened. There are no exceptions. You open it, you've bought it.

OEM software is also tied to the motherboard it is first installed on. Unlike the retail versions of Windows which can be transferred to a new computer, OEM versions are not transferable. What about upgrading hardware? Microsoft says that anything is fair game, except the motherboard. Replacing the motherboard in a computer results in a "new personal computer," which the company considers to be synonymous with a transfer. It's not permitted with an OEM edition of Windows.

Nevertheless, I've known users who got around this limitation by calling Microsoft and reporting that their motherboards died when they wanted to build a new computer. It is Microsoft's policy to allow motherboard swaps in instances where a system is defective or has suffered a hardware failure. But you shouldn't bank on this approach; there's no guarantee it will work and, well, liars don't get ice cream. Also, while retail versions of Vista include both 32-bit and 64-bit versions of Windows, OEM versions are specific. You get one or the other. This follows from the per device restriction. The end result is that OEM versions may not be that attractive to users who frequently build new computers from the ground up.

Then there's support. Technically, OEM versions of Windows get first-tier support from the system builders who put the OEM software on your machine. In the case of Mom & Pop Computers, that means M&P is your first support hit. In the case of you buying OEM software for yourself, technically this means that you're your own support. What does this really mean? Retail Vista comes with 90 days of free support. OEM edition users don't get that, but paid support is still an option, should you need it.

The sum difference

Should you consider OEM software? I've outlined the issues, now it's up to you. Just keep in mind one thing: Microsoft has shown renewed interest in enforcing the terms of its licenses, and the technology that helps the company do so is getting more pervasive, and smarter.

Ken Fisher / Ken is the founder & Editor-in-Chief of Ars Technica. A veteran of the IT industry and a scholar of antiquity, Ken studies the emergence of intellectual property regimes and their effects on culture and innovation.